ExplainSpeaking: The other ‘NEET’ that India policymakers need to address

The recent youth protests that led to the ousting of India's Union Education Minister have spotlighted not only the importance of education, but also highlighted issues surrounding youth unemployment. Traditionally, the government has relied on the Unemployment Rate (UER) to demonstrate India's economic progress; however, this metric alone may not paint a complete picture. While the UER has decreased from 6.1% in 2017-18 to 3.1% in 2025, it fails to account for several critical issues faced by India's youth.

For one, the unemployment rate for individuals aged 15 to 29 years is still quite high, even though it has been on a downward trend. Chart 2 reveals that it has remained stable around 10% since 2022-23. Furthermore, the unemployment rate tends to be highest among those with higher educational attainment. Table 1 shows that graduates aged 25 face an unemployment rate of almost 40%, meaning that nearly 4 out of 10 graduates are unable to secure employment.

Another problem is the quality of jobs being created. Although the number of jobs has increased, many are either in agriculture or in low-paying sectors. The State of Working India (SWI) 2026 report states that 40 million of the 83 million jobs added between 2021-22 and 2023-24 were in agriculture. Additionally, women's involvement in the workforce has risen, but most are in self-employment, which often pays very little.

The report notes that the number of women in own-account self-employment has nearly quadrupled since 2017, but earnings have stagnated.

Lastly, the UER may be an unreliable indicator of job market stress in India. This is because the unemployment rate is measured as a percentage of the people demanding a job, but not everyone registers as job seekers in official surveys. Women, in particular, may not be counted as part of the labor force due to social norms, leading to an underestimation of the true unemployment rate.

Instead, the NEET metric — an acronym for "Not in Employment, Education, or Training" — provides a more comprehensive understanding of how the Indian economy is failing its youth. NEET includes those who are unemployed, as well as those who are not in education, training, or employment. According to the APU report, the NEET rate among Indian youth aged 15 to 29 years is a crucial indicator of the country's labor underutilization.